Future Forces In Banking: The Perspective of Bankers September 2015

Transcription

1 Future Forces In Banking: The Perspective of Bankers September 2015

2 The Change Factor It is now a race between a bank s ability to change verses the current & future levels of disruption, in order to remain relevant. 2

3 Survey Background 3

4 Some Would Consider Shadow Banking Would you consider shifting from your current charter, to becoming a shadow bank (forgoing some margin, to relieve the regulatory burden you face)? 4

5 Uncertainty On Regulatory Relief Will regulatory relief and a two tier regulatory system (Financial Regulatory Improvement Act of 2015), as currently discussed, provide you with any meaningful relief from your current regulatory burden? 5

6 The Next Downturn: Likely 2+ Years Away 6

7 Non Bank Competitors: Limited Impact Currently Which statement best captures your feeling regarding non traditional, online only lenders (e.g., Moven, Lending Club, Prosper, Quicken Loans)? 7

8 But Impact is Much Greater in 5 Years! That is 81% of banks! 8

9 Many Bankers are Preparing for the Disruptors 9

10 Future of the Branch Network: Split Opinions 10

11 Branch Strategies Given quickly falling traffic, items processing and traditional banking activity, banks will need to find a way to either better utilize branches or reduce them. Equally important will be to enhance mobile delivery capabilities. 11

12 Borrower Hesitancy Persists 12

13 Future Cyber Security Impact: Will not Change Usage 13

14 The New Normal Persists for Bankers 14

15 Trend of Fewer Banks/CUs Will Continue 15

16 Bankers Recognize Need to Change 16

17 Decreasing Margins for Many 17

18 Comments On The Future Burdensome regulation will drive consolidation (14+ comments) Banking is becoming the brave new world! Only those with fortitude, imagination, willingness/capacity to be a visionary and change agent will survive! (7 comments) Nationalization of banking is being achieved through regulation rather than ownership structure (2 comments) Look for large scale branch reductions Technology will leverage the community bank with the ability to maintain the community bank feel 18

19 Comments On The Future Banks will partner more with fintech to counter margin compression Community banks that do not effectively add technologies while maintaining strong customer relationships will be bought or fail in the next years Community banks that don t learn to leverage technology to reduce cost and increase engagement will be merged out of the industry The coming pace of change will leave many community bank management teams behind 19

20 Comments On The Future Banking will not be a word for those under 26. It will be called some thing like PaySave, because that is what it will be about - Paying or Saving Adequate staffing will be community bank s largest challenge in the next 10 years There will be more niche competitors in lending The banking activities will evolve from the bank buildings to more of an integrated process in our lives and devices 20

21 The End THANK YOU! Joseph Cady CS Consulting Group LLC (858) Chris Nichols Chief Strategy Officer CenterState Bank

22 Disclaimer: This presentation is for general strategic information only and should not be relied upon as a substitute for independent research before making a material management decision. This presentation does not take into account any particular bank s performance objectives, financial situation or needs. All banks should obtain advice based on their unique situation before making any decision based upon this presentation or any information contained within. In addition, any implied projections or views of the bank market provided by the authors may not prove to be accurate. While all the information contained herein is believed to be accurate as of the date of source or publication, the information is subject to change and constant revision. Copyright CS Consulting Group LLC and CenterState Bank, All rights reserved.